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Senior Ways and Means Democrat Lays Out Objections to TPP

Friday, February 19, 2016

Sandler, Travis & Rosenberg Trade Report

House Ways and Means Committee Ranking Member Sander Levin, D-Mich., said Feb. 18 that he cannot support the Trans-Pacific Partnership as negotiated because its provisions on worker rights, currency manipulation, rules of origin and investment are “wholly inadequate.” Levin added that TPP’s provisions on access to medicines, environmental standards and state-owned enterprises are not as strong as those he urged negotiators to reach. He also called on the International Trade Commission to conduct “a much more comprehensive review” of the economic impact of the TPP that “reflects the realities of international trade today so that we can spark a constructive debate about the issues most at stake – jobs and wages for American families.”

Worker Rights. Levin said TPP lacks mechanisms to ensure the full implementation and enforcement of its labor commitments. He noted that Vietnam, Malaysia and Mexico, which he said “fall woefully short of international labor standards,” are not required to change their laws and practices to comply with TPP labor obligations before Congress votes on the agreement.

Rules of Origin. The negotiated text significantly lowers the content requirements under NAFTA, Levin said, which could result in U.S. consumers “driving TPP cars or trucks with over half of their parts by value made in China or elsewhere and the vehicle itself assembled in Mexico.”

Currency Manipulation. According to Levin, rather than adopting the standards set by the International Monetary Fund for defining and addressing currency manipulation, TPP finance ministers adopted an unenforceable side declaration that will not address this issue in any meaningful way.

Investment. Some changes to the investment chapter were negotiated, Levin said, but the U.S. failed to reform this chapter in important ways. However, he praised the tobacco carve-out (omitting tobacco regulations from the scope of the measures that can be challenged under the investor-state dispute settlement mechanism) and said it should not be weakened.